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The countries of East Central Europe stand out as examples of the advantages of early and successful transitions to the market. Besides being early reformers, these countries also moved unusually quickly toward the establishment of broad social protection programs intended to cushion the shocks of the transition and to provide some longer-term protection against the uncertainties of the market economy. The success of these strategies has been uneven in terms of their impact on fiscal resources and their overall effect on the distribution of income. However, they must also be assessed in terms of the support they have generated for political and economic system among economically vulnerable but politically influential middle-class, blue-collar, and rural social sectors. In the countries of Central Europe, social transfers directed toward such groups have helped to win their acquiescence to painful adjustments and have facilitated longer-term support for democratic politics.

The countries of East Central Europe stand out as examples of the advantages of early & successful transitions to the market. Besides being early reformers, these countries also moved unusually quickly toward the establishment of broad social protection programs intended to cushion the shocks of the transition & to provide some longer-term protection against the uncertainties of the market economy. The success of these strategies has been uneven in terms of their impact on fiscal resources & their overall effect on the distribution of income. However, they must also be assessed in terms of the support they have generated for political & economic system among economically vulnerable but politically influential middle-class, blue-collar, & rural social sectors. In the countries of Central Europe, social transfers directed toward such groups have helped to win their acquiescence to painful adjustments & have facilitated longer-term support for democratic politics. Tables. [Reprinted by permission of Sage Publications Inc., copyright 2007 by the American Council of Learned Societies.]

During the debt crisis of the 1980s, new democratic governments in Argentina and Brazil experimented with heterodox approaches to economic stabilization, whereas Mexico's dominant party regime adopted a far more orthodox line of adjustment. None of these approaches had led to a sustained recovery by the end of the decade. Differences in policy choices are attributable to goals and beliefs of top decisionmaking officials and to the way the institutional features of their respective political regimes structured time horizons and vulnerability to domestic distributive pressures

The economic policies of Argentina, Brazil, & Mexico in response to the debt crisis of the 1980s are examined. Argentina's & Brazil's heterodox policies of wage/price controls & currency reform developed in the context of: (1) the enlargement of the arena of distributive politics; (2) legislation by executive decree; (3) avoidance of structural reform issues; & (4) conflicts with the International Monetary Fund. Mexico's economic policies, reflecting the pressures of populism & reformism, were more orthodox in regard to monetary & wage controls & represented a commitment to participation in international trade. The inability of both types of policy to reduce fiscal deficits & provide relief from external debt is discussed. 1 Table, 9 References. D. Generoli

Stabilisierungspolitik wegen hoher externer Verschuldung führt zu inneren Konflikten. Ein Vergleich zeigt, daß Mexiko diese durch die Integration der Arbeiterorganisationen in den Herrschaftsmechanismus besser bewältigt. In Brasilien und Argentinien war das Militär zu langfristiger Stabilisierung unfähig. Erfolglos blieben auch frühere demokratische Regierungen mit ihren Konzepten (Sozialpakte u.a.). Die gegenwärtigen Demokratien müssen die Arbeiterbewegung als loyale Opposition behandeln. Dabei begünstigt Handelsexpansion den Mitte-Rechts-Kurs in Mexiko und Brasilien, Handelsschrumpfung den Kampf der argentinischen Mitte-Links-Regierung gegen konventionelle Lösungsansätze der Schuldenkrise. (SWP-Spb)

Domestic conflicts associated with the politics of economic stabilization; based on conference paper.

For Latin American governments, mediating between their national societies and the international economy, the contemporary debt issue poses some excruciating dilemmas. On the one side, these governments are under intense pressure to arrive at satisfactory formulas for settling their debts–satisfactory, that is, to the banks and creditor agencies that control access to international financial markets. Loss of such access would threaten vital capital and trade flows, and for this reason virtually every Latin American government has so far placed a high priority on meeting its external obligations. But governmental elites, if they are to remain in power, must also answer to (or repress) their own populations. And the price to be paid for external help with "liquidity problems" has typically involved politically dangerous stabilization measures (devaluations, wage and credit restrictions, and fiscal deficit reductions)–measures that often arouse the strong opposition of major social forces.